Haldia pays up in shares to IOC

08-Jul-05

Will Indian Oil Corporation's (IOC) Rs 150-crore cheque that was with Haldia Petrochemicals Ltd (HPL) since February 18, be encashed as per the directions of the Bengal Government? It is not clear to us why the shares are not being issued to IOC. Will the unexplainable delays in allotting share to IOC be overcome finally? A recap into the matter shows that at the outset, HPL chairman Tarun Das had invited IOC to join HPL. A proposal for a 7.5% stake by IOC was approved by the HPL board. However, despite board approval and IOC issuing the cheque to HPL in February, neither has the cheque been encashed nor have the 7.5% shares been issued. In a reaction to the delays in non-issuance of shares, IOC issued legal notices to HPL. Haldia Petrochemicals has not replied yet. The key reason for the delay seems to be the non-compliance of Purnendu Chatterjee (one of the principal promoters of HPL). TCG was against the idea of bringing in IOC as a strategic investor, as the group dreaded that IOC may eventually buy out the West government's stake in HPL and emerge as the majority shareholder. West Bengal Government is of the opinion that if Chatterrjee does not allow IOC's entry, he should bring in the required funds for buying out the state government's stake Also precipitating the matter is the Basell takeover by a consortium of which Chatterjee was to be a part. Chatterjee wanted HPL to be a part of the Basell takeover. The Bengal Government has been firm that HPL will not be allowed to invest in Basell as long as Bengal remains a principal promoter. The minister also made it clear that Purnendu will have to bring in Rs 1560 crore in one go to acquire the government's stake in HPL. He has already missed the deadlines set by the government. The fresh deadline is July 31 Purnendu is no more a consortium partner in the $5.7 billion Basell deal. Access Industries, owned by Russian-born oil billionaire Leonard Blavatnik, is buying out Basell on its own.